UK PPA warns lifting of postal controls will hit B2B sector
Business-to-business magazines that depend on doorstep distribution could suffer under plans to end price controls on press postage, the Periodical Publishers’ Association (PPA) has warned.
The current Presstream system, which forces Royal Mail to keep prices low for subscription-based magazines, will be unregulated from April 2006 under proposals from the postal services regulator, Postcomm.
The PPA is bringing in consultants to draw up a strategy to help affected magazines deal with the new system.
Postcomm said it believed publishers would be protected from soaring prices because there was sufficient competition in the market to keep charges low.
But Ian Locks, PPA chief executive, said: “The competitive playing field for the Presstream service is set within the context of the postal delivery of magazines.
“Other channels of distribution, such as the newstrade supply chain, simply cannot be regarded as competitors since in the case of almost all business-tobusiness and most customer magazines, newsstand distribution is not an alternative as the reader does not pay for the publication.
“This decision by the regulator poses a major new challenge for magazine publishers, especially coming with the introduction of size-based pricing.” The PPA has argued that, due to the limited geographical reach of alternative operators, there is currently no effective competition to Royal Mail, a situation unlikely to change for the foreseeable future.
A spokesman added: “PPA is also concerned at Postcomm’s apparent failure to understand that for many magazines, the retail supply chain is simply not a viable route to market.”
A spokesman for Postcomm said: “A combination of non-postal and post-onpost competition for Presstream products means customers’ interests can be protected without a price control.”
A three-month consultation period on the proposals is under way. The PPA said it would be consulting with members on its response.
